Samsung Electro-Mechanics Sales Up 30%, Operating Profit Up 165% as AI Impact Accelerates

Samsung Electro-Mechanics said on the 28th that it posted record quarterly revenue and operating profit on a consolidated basis in the third quarter of 2026, driven by rising demand for components used in AI data centers.

The expansion in sales of AI-related products led to higher revenue across the Component business division, and the results also reflected increased sales across all applications in the Component business division centered on AI-related products, revenue growth in FCBGA for AI data centers, and sales growth in FCBGA for automotive applications.

In addition, expanded supply of camera modules for next-generation platforms to global EV customers contributed to the improved results. With that added supply, revenue and profit in the third quarter of 2026 rose sharply.

Samsung Electro-Mechanics' consolidated revenue in the third quarter of 2026 came to KRW 3.7633 trillion, up 30% from a year earlier and 9% from the previous quarter. Operating profit rose 165% year over year and 57% quarter over quarter to KRW 691 billion. Pretax profit increased 116% year over year to KRW 609.7 billion, while net profit rose 113% year over year to KRW 468.7 billion.

Revenue for Samsung Electro-Mechanics' Component business division in the third quarter was KRW 1.883 trillion, up 36% year over year and 14% quarter over quarter on the back of stronger sales of products related to AI data centers. Revenue increased across all applications, led by products for AI data centers such as servers, networks and power supplies.

As high-performance GPUs for AI servers become more advanced, demand is also rising for higher-capacity and smaller MLCCs. Samsung Electro-Mechanics said the MLCC capacitance required per GPU and ASIC is doubling every year.

The industry calls this phenomenon the 'AI MLCC law.' A structure is taking shape in which advances in AI semiconductors lead to higher MLCC demand.

Samsung Electro-Mechanics expects strong demand for high-spec components for AI data centers to continue in the fourth quarter as well. Accordingly, it plans to expand supply of AI MLCCs, including small and ultra-high-capacity products, and to develop next-generation products early to secure market leadership.

Samsung Electro-Mechanics is pursuing greater supply of high-value-added products in its MLCC and substrate businesses. It is continuing to respond to long-term MLCC supply agreements with major big tech customers and is pushing ahead with expanded supply of high-value-added products such as ultra-high-capacity and high-voltage components for EVs and ADAS.

In the substrate segment, the company is strengthening supply of AI server and accelerator substrates alongside expanded FCBGA sales. For data center-related high-value-added substrates, it is pushing ahead with expanded supply for server CPUs, AI accelerators and networking applications.

Sales for the Package Solution business division in the third quarter were tallied at KRW 939 billion. That was up 58% from a year earlier and 22% from the previous quarter.

The increase in third-quarter sales was driven by expanded supply of substrates for data centers and high-performance substrates for ADAS and autonomous driving. Supply of high-performance substrates for ADAS and autonomous driving also increased, and expanded supply of substrates for data centers, ADAS and autonomous driving supported revenue growth.

Samsung Electro-Mechanics expects demand from data center customers for expanded substrate supply to continue in the fourth quarter as well. It plans to supply new high-value-added FCBGAs for server CPUs and AI accelerators in a timely manner, and also plans to expand Capacity at each production base in a timely manner. It also plans to respond to customer demand by expanding Capacity.

Against a backdrop of higher performance in AI data centers and more advanced systems, Samsung Electro-Mechanics outlined a growth strategy centered on expanding supply of related products in an environment where high-value-added package substrates are becoming increasingly important.

Revenue for the Optical Solution business division in the third quarter was KRW 941.3 billion. That was up 3% from a year earlier but down 9% from the previous quarter.

The year-over-year improvement in the Optical Solution business division's performance reflected the start of mass production of a new 200-megapixel folded zoom camera. In addition, expanded supply of products for foldable phones and increased supply of automotive camera modules for next-generation platforms to global EV customers also contributed to the improvement.

Samsung Electro-Mechanics plans to mass-produce high-resolution, slim cameras for a major strategic customer’s next flagship smartphone in the fourth quarter. It also plans to expand supply of products for automotive and next-generation platforms for global EV customers.

The company also plans to respond to rising demand driven by more advanced autonomous driving technologies and the commercialization of humanoid robots.

Samsung Electro-Mechanics aims to sustain its growth through a strategy of increasing the share of high-value-added products centered on MLCCs for AI data centers, high-value-added package substrates for AI data centers, and automotive component supply. As a result, fourth-quarter performance is expected to be shaped mainly by demand for high-spec components for AI data centers and demand for autonomous-driving-related automotive components.

Source: TECHWORLD · Park Kyu-chan
Original: https://www.epnc.co.kr/news/articleView.html?idxno=408893

References

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